The mammalian NAB proteins have been identified previously as potent co-repressors of the EGR family of zinc finger transcription factors. Drosophila NAB (dNAB), like its mammalian counterparts, binds EGR1 and represses EGR1-mediated transcriptional activation from a synthetic promoter. In contrast, dNAB does not bind the Drosophila EGR-related protein klumpfuss. dnab RNA is expressed exclusively in a subset of neuroblasts in the embryonic and larval central nervous system (CNS), as well as in several larval imaginal disc tissues. Here, we describe the creation of targeted deletion mutations in the dnab gene and the identification of additional, EMS-induced dnab mutations by genetic complementation analysis. Null alleles in dnab cause larval locomotion defects and early larval lethality (L1–L2). A putative hypomorphic allele in dnab instead causes early adult lethality due to severe locomotion defects. In the dnab -/- CNS, axon outgrowth/guidance and glial development appear normal; however, a subset of eve+ neurons forms in reduced numbers. In addition, mosaic analysis in the eye reveals that dnab -/- clones are either very small or absent. Similarly, dNAB overexpression in the eye causes eyes to be very small with few ommatidia. These dramatic eye-specific phenotypes will prove useful for enhancer/suppressor screens to identify dnab-interacting genes. © 2002 Wiley-Liss, Inc.